Why The #WWENetwork Was Doomed To Fail In The US

$9.99 a month seems like a dream price for access to the WWE's entire wrestling library, right?  I mean DAYS worth of content from the territories, from WCW, ECW, and the various eras.  Pay-Per-View no longer an overpriced nicety but a cost effective avenue to get your fix.  Yet, WWE failed to even scratch the surface of American viewership.  Why?  It's easy...the price doesn't make sense.


"But you just said $9.99/month is an awesome price!!" it is, and frankly that's the problem.  It's TOO awesome.  It doesn't shake up PPV at all, and it's too easy to get burned out on the content to make sense in the long run.  The key measure of a sustainable product is a price that makes sense to both the customer and the business.  Do you know why cable companies charge nearly $70/pop to watch a PPV?  It's because they can.  If it's an exciting enough event, people will pay that rate.  Nobody would pay that to watch a Rocky & Bullwinkle marathon; it's not worth that price.  But they would pay it to watch Floyd Mayweather, Ronda Rousey, Rampage Jackson, Canelo Alvarez, or The Rock do what they do best (and no, Dwayne, that's not movies.)

No...the key here is value proposition.  In Economics, it literally means "how much is X worth to Y?, with the goal being that the answer is "substantial" no matter what you fill in for "X" or "Y".  If "X" equals the WWE Network and "Y" equals consumers, there should be substantial value for the dollar.  If "X" equals consumer growth and "Y" equals shareholders, there should be substantial appetite to grow consumers, and so on.  WWE, unfortunately, missed the boat on how that all works. It's not that the Network isn't of value to consumers, no.  It's that the consumers aren't of value to the shareholders at the price they put, unless they managed to get almost all of the regular fans in the boat.

WWE made even more egregious errors by assuming that the "millions and millions" of fans following The Rock, Cena, Zack Ryder, Hornswoggle, etc. would jump at the chance to pay $9.99 a month for access to the full library.  First of all, most of the people on Twitter aren't old enough to pay that money themselves.  Second, WWE was the one who purposely abandoned the older fan audience in favor of the younger fanbase - the fanbase who can't buy something without Mommy and/or Daddy giving up a credit card.  If Mommy and/or Daddy aren't fans they won't see the value (there's that "Value proposition" again) in paying for that when they could just buy a toy for Lil Jimmy and have him be happy for months.

So what's the right answer?  The thing is, WWE had the right idea but the wrong execution.  Remember XFL?  That's yet another example of a right idea executed poorly.  Trying to compete with the NFL was a losing proposition long before it began, especially since Vince had no experience whatsoever with football.  What he did have though was innovation: A lot of what was good in the XFL was later stolen by NFL and is now in use there with no credit back to the McMahon legacy.  Means that had Vince kicked the thing off correctly, we'd still be watching XFL matches.  "Correctly" simply means not directly competing with anyone, but providing an alternative that has no association with WWE whatsoever beyond the financial backing.  Don't show Vince McMahon screaming "XFL!!".  Don't have Good Ol' JR doing commentary (as good as he is and was, it was a mistake to have him associate with XFL at the time).  Don't have the players cutting promos backstage with the cheerleaders.  Yes, Vince committed all of those sins.  People don't watch football to be entertained; they watch football to see the sport.

Thus the issue with the WWE Network.  They're pushing all of this entertaining "extra programming" to try and grab more fans, and using WWE televised programming and Total Divas to drive people to subscribe.  It's all wrong and I'll break down in bullets what they should have done (it's too late to correct now).

1. RAW, SmackDown, NXT Season 1/2/3 and Redemption, Main Event, Saturday Night's Main Event, Prime Time Wrestling, Velocity, Heat, Jakked, WWECW, and Tough Enough should all be there, every episode.
   
   You might think I've lost my mind, but here's the thing.  Some of the best of WWE occurred on weekly programming, NOT on a PPV.  NXT Season 1 was criticized, 2 was boring, but 3 was actually getting good and Redemption had the best storylines in all of WWE.  Prime Time Wrestling featured the biggest names in WWE's history on a weekly basis in normal matches, promos and backstage skits.  We got to see the character's evolution as a talent and watch them add credibility to titles.  Velocity/Heat/Jakked featured lesser known talent and often great wrestling matches (did you know AJ Styles and Samoa Joe once wrestled in WWE?).  WWECW got a bad rap from ECW fans, but if you stopped judging it that way, it actually some of the best character development especially guys like Elijah Burke, Umaga, Lashley and Zack Ryder.  I could go on and on, but the episodic content is what made WWE what it is today.  Take it one step further and stream the current week's RAW and SmackDown alongside NXT and Main Event so that people have a one-stop-shop for all of their weekly WWE programming, all for a low monthly rate compared to the cable company.
   
2. Episodic content should not be comingled with PPV content.
   
   What?  That's right, I said it...the episodic content I mentioned before is what should be $9.99 a month.  Access to every single episode of content they have, and extend that to the WCW weekly episodes.  Basically, you're offering a very powerful competitor to cable.  But PPVs are a different beast.  They need to make more money than the weekly episodes because they often cost more to produce, especially WrestleMania.
   
3. The pricing model should support making profit, but not ripping people off.
   
   And this is going to sound ironic, having it all bulked in with the $9.99/month means people won't expect much out of it and you won't make much money. Money is desperately needed to optimize the streaming experience much less pay people; so a better answer is to allow people to pay a one-time charge to watch PPV that is cheaper than what the cable providers charge, and do it in tiers.  For older PPVs from a consumed organization, i.e. ECW or WCW, give consumers the option of doing an addon $5/month to access them.  You now have two separate revenue streams: weekly episodic and PPV.  You're competing directly with Netflix and beating them handily.  For archived WWE PPVs, the addon price must be higher; $10/month.  
   
   But then, for live streaming of PPV events, charge a flat rate and discount if they're on the archived plan.  Charge $30 one-time for access to stream the PPV in high definition; no WWE Network subscription required.  If you already subscribe to archived PPVs, $20 one-time.  Now, you're eating into cable company profits AND making online stream sites that charge, nervous.  They can't guarantee the uptime like you can; you're making it worth paying for and a hell of a lot cheaper than the cable company's $60-70 for PPV.  You're also proving that an a la carte pricing model can work with consumers.  Other sports will sit up and take notice of this, especially Boxing.
   
4. If you are going to say Uncut and Uncensored, you'd better deliver.
   
   The WWE Network is rife with bleeps, artifacts and other forms of censorship.  It's also not uniform; one ECW PPV will allow every cuss word under the sun while another is bleeped out.  Breasts are always censored and music that WWE refused to pay rights for has been modified in peculiar fashion (Chris Jericho didn't have "Break Down The Walls" when he was "Lionheart" in WCW, yet they play that theme).  They backed themselves into a wall with this one: Promising to deliver "EVERY PPV" yet not researching to confirm they could actually do that "UNCUT AND UNCENSORED".

Again, it's too late to switch gears on any of the above.  But in summary, they came in unprepared, priced at a level that would not guarantee the income they wanted, lacking the content that people really want to see, and the net effect is burnout; people canceling because Daniel Bryan didn't win, or because of them ramming $9.99 down our throats in desperation, or because stream quality is poor.  That groundswell will continue, and fortunately for WWE, the international fans are a lot more tolerant of "...a B+ player".